MPs size up venture capital as an engine for ‘levelling up’
MPs revealed they are exploring the potential of venture capital to act as an engine of the government’s ‘levelling up’ agenda today, as the Treasury Select Committee opened a consultation into the state of the industry.
In a statement today, the influential committee said it would scrutinise whether firms can access the capital they need to scale up, as well as the effectiveness of tax incentives like the Enterprise Investment Scheme to encourage investment into UK startups.
Chair Mel Stride said the consultation would look to unlock the venture capital industry’s “key role” in driving the net-zero and levelling up agendas.
“The Government’s plan to enable the UK to continue advancing the frontiers of science and technology, as well as its ambitions on net zero and levelling up, will all be boosted if businesses are able to finance their work to achieve international success,” he said,
“As a Committee, we’ll be seeking to establish if investors have the best environment to back new or growing UK firms, and would welcome in particular evidence on what lessons can be learnt from other parts of the world.”
Stride said the group would also be scrutinising the effectiveness of policy designed to widen the potential pool of capital for venture capital firms, including changes to pension rules which would allow institutional investors to back VC firms.
The Treasury announced another consultation on loosening a pension charge cap last month, as it looks to unlock pension cash to flow into VC and private equity.